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Date: 16th January 2024.

Dollar Demand Rises and Global Stocks Tumble, Find Out Why!



*Investors price in 6 rate cuts in 2024, but all Fed members remain hawkish. Economists advise investors are getting ahead of themselves and the Fed is only likely to cut 3 times.
*Finance giants gather in Davos and advise markets rate cuts are premature and the risk of inflation still remains.
*Trump beats Ron DeSantis in Iowa and is on track to represent the Republicans in the 2024 US elections.
*The UK’s employment sector remains resilient, but salaries again see a considerable slow-down. The salary slowdown pushes the Pound lower.

GBPUSD – UK Salaries Decline And Dollar Demand Rises

The GBPUSD is trading at its lowest level since January 5th after being pushed lower by Dollar strength and UK data. The US Dollar Index has been increasing in value for 3 consecutive days due to higher inflation data and hawkish comments from global banking leaders. Another indication that interest rates are likely to remain high is this week’s bond yields. During this morning’s Asian session, the US 10-Year Bond Yields rose 0.055% and again rose above 4.00%. Higher bond yields are known to be Dollar bullish, but investors will monitor if bond yields can hold onto gains. This is something yields were not able to achieve last week.

The Pound this morning is declining against all currencies which provides traders with clear opportunities within the GBPUSD. However, the data from the UK is not “all bad” for the Pound. The UK’s Claimant Count Change read 11,700, lower than previous expectations and lower than the previous 3 months. Strong employment means higher consumer demand and means a trickier fight against inflation. However, the lower earnings do help regulators fight against inflation. As a result, investors are ditching the Pound in favor of the Dollar.

According to analysts, investors today have preferred the Dollar where there is already confirmation that inflation rose. Nonetheless, the Pound may correct if tomorrow’s UK inflation data is higher than the 3.8% expectations. Though, if inflation does read 3.8% or lower, the Pound may witness further downward momentum.

When evaluating indicators and technical analysis, the GBPUSD exchange rate is currently witnessing potential sell signals. The price is trading below trend-lines, average price movements and below the neutral on most oscillators. The price is also trading below the regression channel and the regression channel is also widening while declining. All the above indicates downward price movement, however, if the price rises above 1.27127, these signals can potentially change.



US30 – Global Sentiment Towards Stocks Declines. Eyes on Goldman Sachs Earnings!

The US30 is experiencing a decline during this morning’s Asian session, similar to all other US indices. The US30 was pressured by negative earnings data from the banking sector on Friday as well as the possibility of less rate cuts this year. However, technical analysts remind investors that the price has declined to a previous support level which the asset has not been able to break on the past 3 occasions. Traders monitor the price action as the asset tests this support level.

The next vital announcement for the asset will be Goldman Sach’s earnings report which will be made public before the US Session opens. Analysts expect the banking giant to see a 23% drop in earnings per share and a slight decline in revenue. Though, if the data is lower than expected, the stock price can decline. Goldman Sachs is the third most influential stock within the Dow Jones and holds 6.63% of the index.

Lastly, another negative for the USA30 is the stock market performance today globally; UK, EU and Asian indices are trading lower. The poor sentiment within the stock market is largely due to hawkish comments from the Fed and finance ministers in Davos. Analysts advise investors are pricing in up to 6-7 rate cuts in 2024, but banks are predicting 3-4.



Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date: 17th January 2024.

Eurozone Economic Trends: Inflation, Growth, and Central Bank Outlook.



In the ever-evolving landscape of the Eurozone economy, key indicators suggest a complex scenario of lower inflation and weakened growth. While central bank officials express optimism about a potential soft landing, the ongoing improvement in German ZEW investor confidence supports this outlook. As we delve into the intricacies of economic data, it becomes evident that the European Central Bank (ECB) is contemplating rate cuts later this year, despite maintaining a cautious wait-and-see stance, while investors are onec again buying into hopes of early trade cuts.

Eurozone data so far was mixed, with German HICP ticking up at the end of 2023 and German ZEW investor confidence coming in stronger than anticipated. At the same time, consumer inflation expectations declined, according to the latest ECB survey. ECB officials meanwhile continued to signal that it is too early to talk about rate cuts, even if ECB’s Villeroy repeated that rates are set to decline this year.

German Inflation Landscape: German HICP inflation, confirmed at 3.8% y/y for December, reflects a nuanced picture. The rise in national CPI to 3.7% y/y is partly attributed to base effects from a one-off energy support payment in December 2022. Notably, food price inflation eased to 4.6% y/y, contributing to an overall inflation rate of 3.5% y/y when excluding energy and food. The challenge lies in the impact of these rising prices on disposable income, weighing on demand and overall growth.

Economic Contractions and Optimism: The German GDP contracted -0.3% last year, with adjusted figures showing a flash estimate of -0.1%, potentially indicating a technical recession in the latter half of 2023. Factors such as high inflation, increased debt financing costs, and weakened domestic and external demand have posed challenges to the recovery from the pandemic. Despite these setbacks, German ZEW investor expectations unexpectedly improved, suggesting a cautious optimism driven by hopes of major central bank rate cuts.

Eurozone Industrial Production and Trade Dynamics: Eurozone industrial production contracted -0.3% m/m in November, aligning with expectations and signaling a potential decline in GDP for the last quarter of 2023. Concurrently, the Eurozone seasonally adjusted trade surplus widened to EUR 14.8 billion in November, driven by a rise in exports and a decline in imports. However, the subdued improvement in real terms indicates that the widening surplus may not necessarily signify an overall economic upturn.

Central Bank Insights and Currency Movements

ECB officials remain vigilant, emphasizing that it is premature to declare victory over inflation. Despite differing opinions within the central bank, the latest ECB survey shows a drop in consumer inflation expectations. Geopolitical risks further complicate the outlook, with potential impacts on inflation. Austrian central bank head Holzmann cautions against expecting a rate cut in 2024 amid increasing geopolitical threats.

In the current WEF Annual Meeting, ECB’s Lagarde flagged rate cuts in the summer. When asked about a possible rate cut in the summer the central bank head told Bloomberg she suggested that there is likely to be a majority in favor of such a move by then, but cautioned that the ECB has to be “data dependent”. Lagarde stressed “that there is still a level of uncertainty and some indicators that are not anchored at the level where we would like to see them”. Meanwhile, ECB’s Knot stated it’s unlikely that rates will go up again, but he warned that the ECB needs to see a turnaround in wages before making a decision and that any easing, if it happens, will be very gradual. Knot also stressed that the more easing markets are pricing in, the less likely it is that the ECB will indeed cut rates. More push back against excessive rate cut expectations has put bonds under pressure this morning, amid the large number of central bankers stressing that rate cuts are not on the agenda for now.



US30 – Global Sentiment Towards Stocks Declines. Eyes on Goldman Sachs Earnings!

EURO: Central Bank and Growth Outlooks Influence Exchange Rates

In the currency markets, EURUSD has undergone correction in response to central bank and growth outlook uncertainties. With the USDIndex surpassing the 103 mark and Treasury yields fluctuating, EURUSD corrected to 1.0883, reflecting the dynamic interplay of market forces.

EURJPY has been oscillating within the 158.50-160.00 range after experiencing a robust rebound to a one-month peak of 160.17 last week.

From a technical perspective, the short-term range is delineated by the 50% and 61.8% Fibonacci retracement levels from the previous decline. Notably, the sequence of higher highs and higher lows, initiated from December’s low point, remains encouraging.

Furthermore, the Relative Strength Index (RSI) is still hovering above its neutral mark of 50, and the Moving Average Convergence Divergence (MACD) is showing marginal strengthening, positioned slightly above its zero and signal lines. This maintains a positive bias in the market sentiment.



Practically, for the bullish momentum to persist, a decisive close above the 160.00-160.50 zone is essential. This breakthrough could pave the way for an advance towards the 78.6% Fibonacci level at 162.00 and the previously breached ascending trendline from March 2023, located at 162.70. Further upward movement may retest the ceiling observed in November at 163.70-164.28.

Conversely, if the price dips below the 158.50 support, a period of consolidation might occur around the 38.2% Fibonacci level at 157.40 before sellers target the lower boundary of the bullish channel at 156.45. A bearish breakout from this point could extend towards the 200-day Exponential Moving Average (EMA) positioned at 155.20.

In summary, while EURJPY retains bullish momentum, a sustained breach above the 160.00-160.50 region is crucial for a more significant upside potential.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date: 18th January 2024.

Gold Council Indicates Higher Prices Amid Geo-Political Tensions.



*The US Dollar Index ends the day higher for a fifth consecutive day but declines during this morning’s Asian Session.
*Investors continue to lower the possibility of significant easing in 2024 after the latest US Sales data.
*US Core Retail Sales were twice as high as expectations and rose to a 3-month high. Additionally, US Industrial Production was 0.2% higher than analysts’ expectations.
*The British Pound gains after inflation rose from 3.9% to 4.00%. The GBPJPY this morning is trading close to all-time highs.
*Gold Report indicates high demand for Gold from institutions amid Middle East tensions and possible lower rates.

USA100 – The NASDAQ Declines But Outperforms Other Indices Due to Upcoming Earnings

The USA100 ended the day lower for the first time after 8 days of consecutive increases. However, technical analysts are noting that the price has shown signs of weakness since November 11th. The price yesterday fell to a new weekly low but quickly saw buyers re-enter the market. Earnings season starts next week for the technology sector and the bullish momentum is likely to remain only if earnings continue to impress. The Dow Jones and the SNP500 did not see an increase in buy orders like the NASDAQ. This is due to significant earnings expected next week for the technology sector.



When looking at the NASDAQ’s individual components, which determines and drives the price movement of the USA100, most stocks were trading lower. Of the top 20 influential stocks only six ended the day high. Of the “magnificent seven” stocks, only Meta rose in value, but not enough to obtain buy signals. From the most influential stocks Intel witnessed the strongest decline falling 2.12%.

Investors continue to scale back interest rate cuts after US data remains strong and economists at Davos correct the market’s outlook. The latest US data was the Retail Sales which read 0.6% and Core Retail Sales reading 0.4%. Both releases read higher than expectations and led to a decline in the USA100 and other indices. The higher UK inflation also lowered global investor sentiment. Today’s price movement globally signals a slight “risk on” sentiment but the question remains as to whether this will remain.

During this morning’s Asian session, the USA100 is trading higher increasing by 0.20%. If we look at most indices around the globe including the JPN225, GER40 and Hang Seng, all are rising. When looking at technical analysis, the price of the USA100 is yet to obtain a “buy signal” from Moving Averages and Oscillators. However, the price is trading higher than the VWAP indicator and buy orders are reading higher than sell orders. Therefore, if upward momentum remains, buy signals will start to materialize after surpassing $16,784.

XAUUSD – World Gold Council Indicates Higher Gold Prices!

Gold fell for a second day on Tuesday after the Dollar continued to strengthen. Bond Yields also rose, which applied further pressure on the commodity. However, Gold trades slightly higher this morning as the Dollar retraces and bond yields decline 0.010%. However, as the European Session opens the Dollar has slightly risen and most other major currencies are declining except the Yen. Therefore, the market still sees demand in safe haven currencies which can negatively affect Gold.

If Gold’s price remains above the pivot point at $2,005.70, buy signals are likely to continue to materialize. The same applies if XAUUSD rises above $2,014, but longer-term timeframes continue to signal weakness in Gold. However, the latest World Gold Council report advises the possibility of a higher Gold price remaining. According to the report, demand amongst central banks remains high and amid tensions in the Middle East many countries continue de-dollarization. Nonetheless, the timing cannot be known, therefore technical analysis remains vital.



Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date: 19th January 2024.

Market Recap: Global Stocks on AI rally; Yen Drifting.



Economic Indicators & Central Banks:

* US labor-market data, strong weekly jobless claims, and higher-than-expected retail sales have added pressure against market rate-cut expectations.
* Markets now pricing a 57% chance of a US rate cut in March, down from 75% a week ago.
* Central bankers suggest markets are overly being aggressive in pricing rate cuts for 2024, contributing to the Dollar’s resurgence amid turbulence in China’s property and financial markets.
* Japan’s core inflation slowed to 2.3% in December, its lowest annual pace since June 2022, easing pressure on policymakers and weakening the Yen to 148.44 per dollar.
* UK: An unexpected rise in British inflation has also led to a pullback in bets on Bank of England rate cuts, supporting the Pound.



Market Trends:

* The TSMC projection of 2024 revenue growth of over 20% boosted Tokyo Electron and Advantest, contributing to a total 497-point jump in the Nikkei on the day, with respective advances of 6.03% and 8.2%.
* Chip-related shares, influenced by US peers’ gains, were prominent performers. Its earnings spurred the biggest rally in chipmakers in more than a month on Thursday and pushed the Nasdaq 100 index to close at an all-time high.
* Chip-industry stocks led a rally in Japan’s Nikkei share average, contributing to a 1.4% daily gain to close at 35,963.27, and a weekly gain of 1.09%.
* “The better-than-expected results from TSMC could be positive signals on demand recovery,” said An Hyungjin, chief executive officer and fund manager at Billionfold Asset Management Inc. “With strong AI demand, not only the US big tech firms but also most tech firms around the world have to invest in AI and that could be good news to stock markets.”

Financial Markets Performance:

* The USDIndex is set for a 2nd consecutive weekly gain as signs of strength in the US economy and cautious remarks from central bankers reduce expectations of rapid interest rate cuts.
* AUDUSD and NZDUSD are on track for their largest weekly gains since November and July, respectively.
* Bitcoin hit a 5-week low at $40,484 as traders took profits following US approval of spot Bitcoin ETFs. Investors poured $1.9 billion into new bitcoin ETFs in the first three trading days, falling short of some aggressive estimates.
* Oil prices held steady at a 3-week high amid escalating tensions in the Middle East, where the US and Iranian-backed Houthis engaged in tit-for-tat strikes affecting global shipping.
* UKOIL hovered around $79 per barrel after a 1.6% rise, while USOIL stood above $74, supported by a decline in US inventories. The US conducted multiple attacks on Houthi targets in Yemen, but shipping remains under threat. President Biden affirmed continued US strikes. Crude prices, marked by volatility, face conflicting factors, including Middle East tensions, Fed rate cut uncertainty, and a well-supplied market forecast by the International Energy Agency.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date: 22nd January 2024.

Market Recap: Stocks extend rally.



Economic Indicators & Central Banks:

* China’s lending rates remain unchanged. That followed the PBOC’s decision to maintain borrowing costs earlier this month, which was another disappointment that did little to boost Chinese stock markets.
* Recent data showing resilient US economic activity has caused a shift in expectations, with markets now predicting rate cuts to start in May instead of March.
* European & US stock futures keep rising, extending the rally in global equities that pushed the US500, US100 and US30 to all-time highs. Optimism over expected Federal Reserve interest-rate cuts and the artificial-intelligence boom boosted Equities.
* Interest rate futures indicate a 100 basis points gap between market expectations and the Fed’s own projections for year-end rates, contributing to the dollar’s struggles.
* In political news, Ron DeSantis withdraws from the US presidential race and endorses Republican front-runner Donald Trump ahead of the New Hampshire primary on Tuesday.





Market Trends:

* Chinese markets underperformed again today toward their lowest level in almost two decades. The Hang Seng plunged -2.8%, the CSI 300 -1.5%. Chinese tech behemoths including Meituan and Tencent Holdings Ltd. were among the biggest drags.
* JPN225 rallied to a fresh 34-year peak today (closed at 36,546.85) on weaker yen but also mainly as the US500’s record-high close on Friday buoyed investor sentiment, despite continued signs of overheating in the Asian market.
* DAX and FTSE 100 are up 0.9% and 0.5% respectively while Treasuries have pared overnight gains, and the 10-year rate is now up 0.8 bp at 4.13%. The short end is underperforming in both the US and the EU.

[imghttps://analysis.hfm.com/wp-content/uploads/2024/01/Copy-of-TELEGRAM-MARKET-UPDATE.png[/img]

Financial Markets Performance:

* The USDIndex is struggling to extend above 103 due to uncertainties related to central bank decisions in Japan and Europe this week. EURUSD down to 1.0890.
* USDJPY had a notable movement, bouncing from a 1-month low to a high, impacted by the Bank of Japan’s 2-day meeting and the expiry of a large amount of currency options.
* Oil prices are down as OPEC member Libya restarted output at its largest field, bolstering global supplies and overshadowing for now concerns about tensions in the Red Sea that look set to continue disrupting shipping.
* Key events for the week include the first estimate of US Q4 GDP, central bank meetings in Japan, Canada and Europe, South Korean economic output data, and initial readings of purchasing managers’ surveys in Europe for 2024.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date: 23rd January 2024.

Market Recap: Asia stocks higher; Yen up post Ueda’s comments.



Economic Indicators & Central Banks:

* China: Reports that Chinese officials are looking into a rescue package for the beleaguered stock market has given Asian equities, and particularly the Hang Seng, a big lift. Sources suggest authorities are proposing some $278 bln be invested in onshore funds.
* Japan: The BoJ left policy unchanged, maintaining its -0.100% policy rate and keeping YCC intact, as well expected. BoJ governor Ueda said there is more certainty in the outlook, which saw JGBs paring earlier gains. There were no significant indications on forward guidance. We see more of a dovish lean from the downwards forecasts, with the Bank likely to leave its stance in ultra-accommodative mode until April when the wage talks should be under our belt.



Market Trends:

* Asian stock markets mostly moved higher, with the Hang Seng surging 3% to a session peak of 15,472 before paring gains to 15,345. The CSI rose to 3240 after slumping to a 5 year low of 3218 yesterday. It was at a 2023 peak of 4201 in late January 2023.
* The JPN225 (Nikkei) is up 0.29% to 36,630.
* Stock futures are higher across Europe, but while the US100(NASDAQ) has found buyers, the US30(Dow Jones) is slightly lower but holds above its record high at 38k.
* Microsoft and other tech giants along with Goldman shares, which jumped 1%, have boosted the Dow higher.

Financial Markets Performance:

* The USDIndex slipped to 102.70 from 103.384 and is seeing broadbased declines.
* USDJPY has been choppy, spiking to 148.55 before drifting down to 147.86.
* Oil prices reached $75 again, as US and UK launch new strikes at Iran-backed Houthi rebels in Yemen, adding to the tension in Middle East.
* BTCUSD dropped below $40,000 as the launch of the first US ETF holds the digital currency abated, as investors take profits off the table. Ether, the second-largest cryptocurrency, fell 6% to $2,325.



Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date: 24th January 2024.

Market Recap: China bourses move higher amid stimulus hopes; JGB yields spike.



Economic Indicators & Central Banks:

* Expectations the FOMC is done hiking rates continued to support Wall Street even if aggressive rate cut bets have been trimmed, while earnings were mixed.
* Yields remain mostly higher, but off their peaks after the decent 2-year auction ($60 bln 2-year note sale). The Treasury is selling $61 bln in 5-year notes Wednesday and $41 bln in 7-year notes Thursday.
* Corporate supply has helped keep the market heavy. IADB priced a $4 bln 5-year SOFR. Also, Romania sold $4 bln in 5- and 10-year notes. Sweden sold a $2 bln 2-year. Bank of New Zealand priced a $750 mln 5-year. Cote d’Ivoire has a $2.6 bln 2-parter. CPPIB Capital offered $1.5 bln in 3-year SOFR.
* Japan reported its exports jumped nearly 10% in December.
* Japanese markets underperformed, with both stocks and bonds hit by speculation that the BOJ is laying the ground for an exit from the negative interest rate environment.
* The China Securities Regulatory Commission, called for better protections for investors and for instilling confidence in the potential for gains in the markets, which have faltered in recent months.



Market Trends:

* Asia: Hong Kong’s Hang Seng surged 2% to 15,569.39, helped by gains in technology companies like e-commerce giant Alibaba, which surged 3.8%. JPN225 (Nikkei) lost 0.8% to 36,226.48.
* The US500 added to its gains, rising 0.29% to its third straight fresh all-time high at 4864.6 US30 however was drag lower as 3M tumbled more than 10% on Tuesday after the company’s 2024 profit outlook came in below expectations.
* eBay will lay off about 9% of its full-time workforce.
* Procter & Gamble climbed 4.1% & United Airlines flew 5.3% higher after stronger profit for Q4 2023.
* Netflix rallied 8% afterhours after the video streaming service handily beat subscriber estimates in the Q4.
* ASML Holding, a chipmaking equipment maker, reported Q4 earnings that beat expectations and its best-ever quarterly orders, but it kept a cautious outlook for 2024 as it faces new restrictions on exports to China.
* Futures are higher across Europe and the US as Treasuries and Eurozone bonds advance.



Financial Markets Performance:

* The USDIndex found legs and rallied to 103.57. It was firmer against 7 of its G10 peers
* USDJPY steadied on 147.70 as Yen gained support after chief Kazuo Ueda said on Tuesday that the prospects of achieving the BOJ’s inflation target were gradually increasing.
* Oil finished -0.3% lower at $74.51 per barrel and Gold was 0.3% higher at $2028.34 per ounce.
* Bitcoin steadied around $39,700, after sliding as low as $38,505 on Tuesday for the first time since Dec 1.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date: 25th January 2024.

Market Recap: Has US avoided recession in 2023? ECB also on tap.



Economic Indicators & Central Banks:

* Treasuries were weak with yields extending higher still, hit by the double whammy of stronger than expected PMI data and an ugly 5-year auction.
* The healthy rally on Wall Street also weighed, though stocks trimmed gains into the close.
* China bourses continued to rally after the PBOC stepped up support measures yesterday by cutting reserve requirements, while hinting at possible rate cuts.
* ECB Preview: The central bank is widely expected to keep policy settings unchanged and stick with a wait-and-see stance for now, which means rate cuts are not on the immediate agenda.



Market Trends:

* Hang Seng and CSI 300 already staged a late rally yesterday and continued to move higher today, with gains of 1.8% and 2.0% respectively.
* European futures are in the red, however, as the ECB meeting comes into view.
* US futures are slightly higher on the anticipation of US GDP later on which could provide clues as to where US rates might be headed.
* Tesla’s profits plummet! Tesla (-5.93% after hours) posted a 23% decline in profits for 2023, its 1st annual decline since 2017!
* Microsoft becomes 2nd company ever to top $3 trillion valuation on AI-driven rally. Apple remains at the top.
* FAA halts Boeing 737 MAXproduction expansion. Boeing -1.32% after hours.



Financial Markets Performance:

* The USDIndex slipped to a session nadir of 102.52 but bounced back to 103.25 to close over the 103 level for a 7th straight session.
* EURUSD is steady at 1.0880. The USDJPY regained some ground after hints at rate rises in Japan triggered selling in the Japanese government bond market. It remains below 148.
* USOIL was up 1.45% to $75.44 per barrel amid ongoing geopolitical risks and following a bigger than expected US inventory draw.
* Gold was down -0.83% to $2012.50 on the stronger PMI data and further trimming in rate cut bets. Markets have reined in expectations for early rate cuts in the US and Europe, and BoJ governor Ueda yesterday hinted that the exit from the negative interest rate environment is coming into view. That should keep gold range bound for now.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date: 29th January 2024.

The Week Ahead – Earnings, Central Banks and Geo-Political Tensions!



* Tensions rise in the Middle East as three US Soldiers are killed in a base near the Syrian-Jordan border after being attacked by Iran-backed militants. Crude Oil price opens 1.15% higher.
* Gold rose 0.63% on Monday due to rising tension in the Middle east. Traders are evaluating whether the market will witness a “risk-off” sentiment this week.
* All eyes on the Federal Reserve’s press conference on Wednesday. Analysts expect the Federal Fund Rate to remain unchanged, but the Press Conference will signal the Fed’s future path.
* The US economy grew 3.3% in the latest quarter, beating expectations of 2.0%. In addition to this, Pending Home Sales rose 8.3% and the Core PCE Index rose from 0.1% to 0.2%.

XAUUSD – Geo-Political Tension Again on The Rise

The US Dollar Index did open Monday’s trading slightly higher, however, has fallen 0.10% over the past 2 hours as of the time of writing. Instead, investors are increasing exposure to Gold. Gold prices are trading 0.63% higher during this morning’s Asian Session and have risen above the most recent resistance levels. When evaluating technical analysis, the price of the commodity is trading above price sentiment indicators, above the neutral on most oscillators and above the day’s VWAP. Here we can see potential “buy” signals, however, investors also should note significant resistance points at $2,037.80. This level has triggered declines on eight occasions over the past month. If the price maintains momentum and crosses this level, Gold will move into the “buy” region of the Fibonacci levels.

The price is largely being driven by two factors: the decline in the Dollar and lower investor sentiment due to rising Middle East tensions. The group which conducted the attack is not yet known, however, President Biden has already advised the US will retaliate. According to the White House, the group is most likely an Iranian-backed militant group which is the main concern for investors. Though investors should note that this will only have a short-term effect if the situation does not escalate.

The next price drive will be the Federal Reserve’s Press Conference and the central bank’s forward guidance on interest rates. This will determine if institutions decide to further expose their funds to the Dollar or look for alternatives. The main alternatives will be Gold and US Bonds. If investors are unconvinced the Fed will keep rates high, Gold could benefit from a weaker Dollar. Tomorrow’s JOLTS Job Openings could also create further volatility.



USA100 – Investors Eye Earnings and Fed Press Conference

US investors are concerned about the developments over the weekend and as a result the rising oil price. Another concern for investors is also if the Fed gives an ultra-hawkish signal on Wednesday after strong economic data last week. Last week, the US PMI rose higher than expectations as did the economy’s Gross Domestic Product. Though stocks and shareholders will equally be monitoring this week’s quarterly earnings reports from major companies.

Tuesday Quarterly Earnings Report

Microsoft – +1.01% over the past week.

Alphabet – +3.30% over the past week.

AMD – +1.58% over the past week.

Wednesday Quarterly Earnings Report

Apple – Unchanged over the past week.

Amazon – +1.35% over the past week.

Meta – +1.61% over the past week.

The performance of the USA100 will largely depend on whether the above earnings are higher than Wall Street’s expectations and on the Fed’s Press Conference. If the Fed is viewed as “ultra-hawkish”, stocks are likely to experience significant pressure if earnings do not exceed expectations.



Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

Date: 30th January 2024.

The Yen Tops All Competitors and Investors Turn to Tech Earnings.



* Monday’s best performing currency was the Japanese Yen which took advantage of a lack of economic data and a rise in geopolitical tensions.
* Analysts advise institutions may increase exposure in the Yen due to geopolitical tensions. Japan’s unemployment rate declines to 2.4%, the lowest in 10-months.
* The USA100 rises ahead of tonight’s vital quarterly earnings reports. Of NASDAQ’s 20 most influential stocks, only three saw a slight decline.
* Tesla and Illumina were NASDAQ’s best performing stocks, rising more than 4% each.

USA100 – Microsoft and Alphabet Earnings Upcoming

The USA100 rose 1.21% on Monday as demand again rose ahead of major earnings from five of the “magnificent seven”. Tonight, investors await the quarterly earnings reports from Microsoft, which yesterday rose 1.43%, and Alphabet, which rose 0.68%. However, investors must also monitor the earnings data from AMD which is the 11th most influential stock for the index.

Even with the strong bullish price action over the past 4 weeks, investors should be cautious about short-term volatility. During this morning’s Asian session, the USA100 is trading 0.16% lower. US indices are known to decline towards the end of the US session and within the Asian session. However, if the price maintains momentum, sell signals can arise. On the 2-hour chart, the price is trading above the 75-bar Exponential Moving Average and above the “neutral” on the RSI. Both indicate strong buying sentiment. However, the latest candlestick is bearish meaning buy signals are not currently active. Fibonacci levels indicate support may be found between $17,505.88 and $17,5870. If the price rises above $17,633, signals will again arise.



So far this morning the US Dollar Index is trading lower, and bonds are increasing in value. Both are indications that the stock market can potentially gain. However, in order for the USA100 to see significant upward price movement, the index will also need to be supported by tonight’s earnings data.

XAUUSD – Fed’s Future Guidance Key For Gold

Gold is currently experiencing strong volatility in both directions but continues to see buyers overpowering sellers. If we look at the price action from the price gap, the commodity rose by 0.47% and from Friday’s close 0.72%. We can see here even with strong bearish volatility at times throughout the day, Gold still finalized a considerable increase. Gold’s price rose a further 0.15% during this morning’s session, but analysts are slightly cautious about the resistance level.



The resistance level at $2,040 has been intact throughout the whole month and was only temporarily able to break above this level. Nonetheless, trend and momentum indicators are signalling upward price movement. Today’s CB Consumer Confidence and JOLTS Job Openings will significantly influence the price action of the Dollar and subsequently Gold. If the two economic releases read higher than expectations, Gold can potentially correct back downwards. However, a lower figure can further fuel the upward movement due to its hedge against inflation and alternative to the Dollar.

According to the US Commodity Futures Trading Commission’s latest report, the number of buy contracts rose by 2.211 thousand and sell contracts fell 11.280 thousand. Here we can see a possible shift towards bullish speculation.

EURJPY – Japanese Yen Currently The Best Performance Currency

The best performing currency of the day and the week so far is the Japanese Yen. Investors are returning to the Japanese Yen as most currencies within the G7 are expected to cut rates in the upcoming months, whereas analysts expect the Bank of Japan to slightly increase rates just before the summer. According to fundamental analysts, the Yen’s haven status can also serve as an alternative to the Dollar while geopolitical tensions rise.

The Japanese Yen is increasing against all currencies but one of its strongest price movements is against the Euro. The Euro has been put under pressure from a dovish outlook set by investors, not necessarily the Central Bank representatives. In addition to this, France’s Flash GDP figures for the latest quarter read 0.0%, meaning the country was very close to officially being in a recession. Investors now turn to Germany and Italy. If both regions also see lower a lower gross domestic product growth rate, the Euro can experience further pressure.

The Japanese Yen on the other hand is likely to be influenced by three releases scheduled for tonight’s Asian Session. Japan will release the Bank of Japan’s Summary of Opinions, the Prelim Industrial Production and Retail sales. Higher data and a more hawkish central bank can support the Yen further, as did today’s Japanese Unemployment Rate. Japan’s unemployment rate today fell from 2.5% to 2.4%. investors also should note that weaker US data can also support the Japanese Yen indirectly.



Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.

Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.